On Sept. 19, the U.S. Department of Health & Human Services (HHS) issued guidance regarding reporting requirements for recipients of funds under the Public Health and Social Services Emergency Fund (the Provider Relief Fund), as authorized under the CARES Act. The reporting requirements discussed in the new guidance apply to Provider Relief Fund recipients who received one or more payments exceeding $10,000 in the aggregate (inclusive of both General and Targeted Distributions from the Provider Relief Fund). This guidance follows previous HHS guidance from July 20 which described the timeline for reports but contained no other meaningful information about the required reporting content.

“Healthcare Related Expenses Attributable to Coronavirus” and “Lost Revenues”   

In the new guidance, HHS states that recipients will be required to report their use of Provider Relief Fund payments by submitting the following information:

• Healthcare-related expenses attributable to coronavirus that another source has not reimbursed and is not obligated to reimburse. These expenses may include general and administrative expenses as well as other healthcare-related operating expenses.
• Provider Relief Fund payments not fully expended on healthcare-related expenses attributable to coronavirus that are then applied to lost revenues, represented as a negative change in year-over-year net patient care operating income (i.e., patient care revenue less patient care related expenses), net of healthcare-related expenses attributable to coronavirus. Recipients may apply Provider Relief Fund payments toward lost revenue, up to the amount of their 2019 net gain from healthcare-related sources. Recipients that reported negative net operating income from patient care in 2019 may apply Provider Relief Fund amounts to lost revenues up to a net zero gain/loss in 2020.

Six-Month Rollover Into 2021

Importantly, HHS said that if a recipient does not expend its Provider Relief Funds in full by the end of the calendar year 2020, the recipient will have an additional six months in which to use the remaining amounts—applying such amounts either toward expenses attributable to coronavirus or towards lost revenues in an amount not to exceed the 2019 net gain.

Categories of Expenses to Be Reported

Recipients will be required to report expenses attributable to coronavirus, net of other reimbursed sources (e.g., receipts from third-party payors and patients), in two aggregated categories: (1) General and Administrative expenses and (2) other healthcare-related expenses. Recipients who received $500,000 or more in Provider Relief Fund Payments will be required to report more detailed information within those two categories. Specifically, such recipients will be required to break down General and Administrative expenses into the following sub-categories: mortgage/rent, insurance, personnel, fringe benefits, lease payments, utilities/operations, and “other.” Similarly, “healthcare-related expenses attributable to coronavirus” should be broken down among supplies, equipment, information technology, facilities, and “other.” 

Reporting entities must use 2019 and 2020 data to calculate and report “lost revenues attributable to coronavirus”—which is represented as a negative change in year-over-year net operating income from patient-related sources. Revenue from patient care payors (e.g., Medicare/aid, commercial insurance/plans, self-pay) is to be reported separately from “other assistance received” (e.g., SBA PPP loans, business insurance).  

Additional Non-Financial Data to Be Reported

Reporting entities will be required to report certain non-financial data on a quarterly basis. Such data will include:

• Personnel Metrics: Total personnel (by labor category), total re-hires, total new hires, and total personnel separations.
• Patient Metrics: Total number of patient visits, total number of patients admitted, and total number of resident patients.
• Facility Metrics: Total available staffed beds for medical/surgical, critical care, and other beds.

Additionally, reporting entities will be required to report changes of ownership resulting from acquisitions or divestitures.

Finally, reporting entities that expended $750,000 or more in aggregated financial assistance in 2020 (inclusive of Provider Relief Fund payments and other federal financial assistance) are subject to Single Audit requirements (45 CFR 75.501).   

Although not mentioned in this latest guidance, HHS has stated elsewhere that the reporting system will be open for providers by Jan. 15, 2021, with the first reporting deadline of Feb. 15, 2021, for all providers and a final reporting deadline of July 31, 2021, for providers who did not expend all of their Provider Relief Fund funds prior to Dec. 21, 2020.

HHS noted that it intends to offer Question and Answer Sessions via webinar in advance of the reporting deadlines, as well as FAQs as needed. Hopefully, those additional materials will flesh out this new guidance and fill in some of the gaps. In the meantime, please contact an attorney in the Health & Life Sciences Group if you have any questions about this new guidance or anything else regarding your receipt or use of Provider Relief Fund payments.

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